Exhibit 10.4


 


COMMERCIAL
GUARANTY


 





	Principal	Loan
    Date	Maturity
    Date	Loan
    No.	Call
    / Coll	Account	Officer	Initials
	$1,800,000.00
    	07/20/2018	7/20/2021	1218300	 	 	ACS	 ACS
	References
    in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan
    or item.
	Any
    item above containing “***” has been omitted due to text length limitations.


 





	Borrower:	 	Hawksite 27 Development Company, LLC	 	Lender:	 	Main Bank
	 	 	333 Rio Rancho Blvd NE, Suite 202	 	 	 	Albuquerque Office
	 	 	Rio Rancho, NM 87124	 	 	 	7300 Menaul Blvd., NE
	 	 	 	 	 	 	Albuquerque, NM 87110
	Guarantor:	 	AMREP Southwest Inc.	 	 	 	 
	 	 	333 Rio Rancho Blvd NE, Suite 202	 	 	 	 
	 	 	Rio Rancho, NM 87124	 	 	 	 
	 	 	P.O. Box 36630	 	 	 	 



 


 



 


CONTINUING GUARANTEE
OF PAYMENT AND PERFORMANCE. For good and valuable consideration, Guarantor absolutely and unconditionally guarantees full
and punctual payment and satisfaction of the Indebtedness of Borrower to Lender, and the performance and discharge of all Borrower’s
obligations under the Note and the Related Documents. This is a guaranty of payment and performance and not of collection, so
Lender can enforce this Guaranty against Guarantor even when Lender has not exhausted Lender’s remedies against anyone else
obligated to pay the Indebtedness or against any collateral securing the Indebtedness, this Guaranty or any other guaranty of
the Indebtedness. Guarantor will make any payments to Lender or its order, on demand, in legal tender of the United States of
America, in same-day funds, without set-off or deduction or counterclaim, and will otherwise perform Borrower’s obligations
under the Note and Related Documents. Under this Guaranty, Guarantor’s liability is unlimited and Guarantor’s obligations
are continuing.


 


INDEBTEDNESS. The
word “Indebtedness” as used in this Guaranty means all of the principal amount outstanding from time to time and at
any one or more times, accrued unpaid interest thereon and all collection costs and legal expenses related thereto permitted by
law, attorneys’ fees, arising from any and all debts, liabilities and obligations of every nature or form, now existing
or hereafter arising or acquired, that Borrower individually or collectively or interchangeably with others, owes or will owe
Lender. “Indebtedness” includes, without limitation, loans, advances, debts, overdraft indebtedness, credit card indebtedness,
lease obligations, liabilities and obligations under any interest rate protection agreements or foreign currency exchange agreements
or commodity price protection agreements, other obligations, and liabilities of Borrower, and any present or future judgments
against Borrower, future advances, loans or transactions that renew, extend, modify, refinance, consolidate or substitute these
debts, liabilities and obligations whether: voluntarily or involuntarily incurred; due or to become due by their terms or acceleration;
absolute or contingent; liquidated or unliquidated; determined or undetermined; direct or indirect; primary or secondary in nature
or arising from a guaranty or surety; secured or unsecured; joint or several or joint and several; evidenced by a negotiable or
non-negotiable instrument or writing; originated by Lender or another or others; barred or unenforceable against Borrower for
any reason whatsoever; for any transactions that may be voidable for any reason (such as infancy, insanity, ultra vires or otherwise);
and originated then reduced or extinguished and then afterwards increased or reinstated.


 


If
Lender presently holds one or more guaranties, or hereafter receives additional guaranties from Guarantor, Lender’s rights
under all guaranties shall be cumulative. This Guaranty shall not (unless specifically provided below to the contrary) affect
or invalidate any such other guaranties. Guarantor’s liability will be Guarantor’s aggregate liability under the terms
of this Guaranty and any such other unterminated guaranties.


 


CONTINUING GUARANTY.
THIS IS A “CONTINUING GUARANTY” UNDER WHICH GUARANTOR AGREES TO GUARANTEE THE FULL AND PUNCTUAL PAYMENT, PERFORMANCE
AND SATISFACTION OF THE INDEBTEDNESS OF BORROWER TO LENDER, NOW EXISTING OR HEREAFTER ARISING OR ACQUIRED, ON AN OPEN AND CONTINUING
BASIS. ACCORDINGLY, ANY PAYMENTS MADE ON THE INDEBTEDNESS WILL NOT DISCHARGE OR DIMINISH GUARANTOR’S OBLIGATIONS AND LIABILITY
UNDER THIS GUARANTY FOR ANY REMAINING AND SUCCEEDING INDEBTEDNESS EVEN WHEN ALL OR PART OF THE OUTSTANDING INDEBTEDNESS MAY BE
A ZERO BALANCE FROM TIME TO TIME.


 


DURATION
OF GUARANTY. This Guaranty will take effect when received by Lender without the necessity of any acceptance by Lender, or
any notice to Guarantor or to Borrower, and will continue in full force until all the Indebtedness incurred or contracted before
receipt by Lender of any notice of revocation shall have been fully and finally paid and satisfied and all of Guarantor’s
other obligations under this Guaranty shall have been performed in full. If Guarantor elects to revoke this Guaranty, Guarantor
may only do so in writing. Guarantor’s written notice of revocation must be mailed to Lender, by certified mail, at Lender’s
address listed above or such other place as Lender may designate in writing. Written revocation of this Guaranty will apply only
to new Indebtedness created after actual receipt by Lender of Guarantor’s written revocation. For this purpose and without
limitation, the term “new Indebtedness” does not include the Indebtedness which at the time of notice of revocation
is contingent, unliquidated, undetermined or not due and which later becomes absolute, liquidated, determined or due. For this
purpose and without limitation, “new Indebtedness” does not include all or part of the Indebtedness that is: incurred
by Borrower prior to revocation; incurred under a commitment that became binding before revocation; any renewals, extensions,
substitutions, and modifications of the Indebtedness. This Guaranty shall bind Guarantor’s estate as to the Indebtedness
created both before and after Guarantor’s death or incapacity, regardless of Lender’s actual notice of Guarantor’s
death. Subject to the foregoing, Guarantor’s executor or administrator or other legal representative may terminate this
Guaranty in the same manner in which Guarantor might have terminated it and with the same effect. Release of any other guarantor
or termination of any other guaranty of the Indebtedness shall not affect the liability of Guarantor under this Guaranty. A revocation
Lender receives from any one or more Guarantors shall not affect the liability of any remaining Guarantors under this Guaranty.
It is anticipated that fluctuations may occur in the aggregate amount of the Indebtedness covered by this Guaranty, and Guarantor
specifically acknowledges and agrees that reductions in the amount of the Indebtedness, even to zero dollars ($0.00), shall not
constitute a termination of this Guaranty. This Guaranty is binding upon Guarantor and Guarantor’s heirs, successors and
assigns so long as any of the Indebtedness remains unpaid and even though the Indebtedness may from time to time be zero dollars
($0.00).


 


GUARANTOR’S
AUTHORIZATION TO LENDER. Guarantor authorizes Lender, either before or after any revocation hereof, without notice or demand
and without lessening Guarantor’s liability under this Guaranty, from time to time: (A) prior to revocation as set forth
above, to make one or more additional secured or unsecured loans to Borrower, to lease equipment or other goods to Borrower, or
otherwise to extend additional credit to Borrower; (B) to alter, compromise, renew, extend, accelerate, or otherwise change one
or more times the time for payment or other terms of the Indebtedness or any part of the Indebtedness, including increases and
decreases of the rate of interest on the Indebtedness; extensions may be repeated and may be for longer than the original loan
term; (C) to take and hold security for the payment of this Guaranty or the Indebtedness, and exchange, enforce, waive, subordinate,
fail or decide not to perfect, and release any such security, with or without the substitution of new collateral; (D) to release,
substitute, agree not to sue, or deal with any one or more of Borrower’s sureties, endorsers, or other guarantors on any
terms or in any manner Lender may choose; (E) to determine how, when and what application of payments and credits shall be made
on the Indebtedness; (F) to apply such security and direct the order or manner of sale thereof, including without limitation,
any nonjudicial sale permitted by the terms of the controlling security agreement or deed of trust, as Lender in its discretion
may determine; (G) to sell, transfer, assign or grant participations in all or any part of the Indebtedness; and (H) to assign
or transfer this Guaranty in whole or in part.


 


GUARANTOR’S
REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Lender that (A) no representations or agreements of any
kind have been made to Guarantor which would limit or qualify in any way the terms of this Guaranty; (B) this Guaranty is executed
at Borrower’s request and not at the request of Lender; (C) Guarantor has full power, right and authority to enter into
this Guaranty; (D) the provisions of this Guaranty do not conflict with or result in a default under any agreement or other instrument
binding upon Guarantor and do not result in a violation of any law, regulation, court decree or order applicable to Guarantor;
(E) Guarantor has not and will not, without the prior written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer,
or otherwise dispose of all or substantially all of Guarantor’s assets, or any interest therein; (F) upon Lender’s
request, Guarantor will provide to Lender financial and credit information in form acceptable to Lender, and all such financial
information which currently has been, and all future financial information which will be provided to Lender is and will be true
and correct in all material respects and fairly present Guarantor’s financial condition as of the dates the financial information
is provided; (G) no material adverse change has occurred in Guarantor’s financial condition since the date of the most recent
financial statements provided to Lender and no event has occurred 


 



     


     


    

	Loan
    No: 1218300	 	COMMERCIAL GUARANTY
(Continued)	 	Page
    2



 


which
may materially adversely affect Guarantor’s financial condition; (H) no litigation, claim, investigation, administrative
proceeding or similar action (including those for unpaid taxes) is pending or threatened against Guarantor in which the amount
at issue is in excess of Two Hundred Fifty Thousand Dollars ($250,000.00); (I) Lender has made no representation to Guarantor
as to the creditworthiness of Borrower; and (J) Guarantor has established adequate means of obtaining from Borrower on a continuing
basis information regarding Borrower’s financial condition. Guarantor agrees to keep adequately informed from such means
of any facts, events, or circumstances which might in any way affect Guarantor’s risks under this Guaranty, and Guarantor
further agrees that, absent a request for information, Lender shall have no obligation to disclose to Guarantor any information
or documents acquired by Lender in the course of its relationship with Borrower.


 


GUARANTOR’S FINANCIAL
STATEMENTS. Guarantor agrees to furnish Lender with the following:


 


Additional
Requirements. Annual Statements. Not later than one hundred twenty (120) days after the end of each fiscal year, Guarantor’s
balance sheet and income statement for the year ended as compiled by Guarantor.


 


Tax
Returns. Not later than ninety (90) days after AMREP Corporation has filed its tax return for the tax reporting period ended,
Borrower shall deliver the AMREP Corporation tax return to the Lender.


 


All
financial reports required to be provided under this Guaranty shall be prepared in accordance with GAAP, applied on a consistent
basis, and certified by Guarantor as being true and correct.


 


GUARANTOR’S
WAIVERS. Except as prohibited by applicable law, Guarantor waives any right to require Lender (A) to continue lending money
or to extend other credit to Borrower; (B) to make any presentment, protest, demand, or notice of any kind, including notice of
any nonpayment of the Indebtedness or of any nonpayment related to any collateral, or notice of any action or nonaction on the
part of Borrower, Lender, any surety, endorser, or other guarantor in connection with the Indebtedness or in connection with the
creation of new or additional loans or obligations; (C) to resort for payment or to proceed directly or at once against any person,
including Borrower or any other guarantor;


 


(D)
to proceed directly against or exhaust any collateral held by Lender from Borrower, any other guarantor, or any other person;
(E) to give notice of the terms, time, and place of any public or private sale of personal property security held by Lender from
Borrower or to comply with any other applicable provisions of the Uniform Commercial Code; (F) to pursue any other remedy within
Lender’s power; or (G) to commit any act or omission of any kind, or at any time, with respect to any matter whatsoever.
Guarantor also waives any and all rights or defenses based on suretyship or impairment of collateral including, but not limited
to, any rights or defenses arising by reason of (A) any “one action” or “anti-deficiency” law or any other
law which may prevent Lender from bringing any action, including a claim for deficiency, against Guarantor, before or after Lender’s
commencement or completion of any foreclosure action, either judicially or by exercise of a power of sale; (B) any election of
remedies by Lender which destroys or otherwise adversely affects Guarantor’s subrogation rights or Guarantor’s rights
to proceed against Borrower for reimbursement, including without limitation, any loss of rights Guarantor may suffer by reason
of any law limiting, qualifying, or discharging the Indebtedness; (C) any disability or other defense of Borrower, of any other
guarantor, or of any other person, or by reason of the cessation of Borrower’s liability from any cause whatsoever, other
than payment in full in legal tender, of the Indebtedness; (D) any right to claim discharge of the Indebtedness on the basis of
unjustified impairment of any collateral for the Indebtedness; (E) any statute of limitations, if at any time any action or suit
brought by Lender against Guarantor is commenced, there is outstanding Indebtedness which is not barred by any applicable statute
of limitations; or (F) any defenses given to guarantors at law or in equity other than actual payment and performance of the Indebtedness.
If payment is made by Borrower, whether voluntarily or otherwise, or by any third party, on the Indebtedness and thereafter Lender
is forced to remit the amount of that payment to Borrower’s trustee in bankruptcy or to any similar person under any federal
or state bankruptcy law or law for the relief of debtors, the Indebtedness shall be considered unpaid for the purpose of the enforcement
of this Guaranty.


 


Guarantor
further waives and agrees not to assert or claim at any time any deductions to the amount guaranteed under this Guaranty for any
claim of setoff, counterclaim, counter demand, recoupment or similar right, whether such claim, demand or right may be asserted
by the Borrower, the Guarantor, or both.


 


GUARANTOR’S
UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and agrees that each of the waivers set forth above is made with
Guarantor’s full knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable
and not contrary to public policy or law. If any such waiver is determined to be contrary to any applicable law or public policy,
such waiver shall be effective only to the extent permitted by law or public policy.


 


RIGHT
OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Guarantor’s accounts
with Lender (whether checking, savings, or some other account). This includes all accounts Guarantor holds jointly with someone
else and all accounts Guarantor may open in the future. However, this does not include any IRA or Keogh accounts, or any trust
accounts for which setoff would be prohibited by law. Guarantor authorizes Lender, to the extent permitted by applicable law,
to hold these funds if there is a default, and Lender may apply the funds in these accounts to pay what Guarantor owes under the
terms of this Guaranty.


 


SUBORDINATION
OF BORROWER’S DEBTS TO GUARANTOR. Guarantor agrees that the Indebtedness, whether now existing or hereafter created,
shall be superior to any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower becomes
insolvent. Guarantor hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever,
to any claim that Lender may now or hereafter have against Borrower. In the event of insolvency and consequent liquidation of
the assets of Borrower, through bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise,
the assets of Borrower applicable to the payment of the claims of both Lender and Guarantor shall be paid to Lender and shall
be first applied by Lender to the Indebtedness. Guarantor does hereby assign to Lender all claims which it may have or acquire
against Borrower or against any assignee or trustee in bankruptcy of Borrower; provided however, that such assignment shall be
effective only for the purpose of assuring to Lender full payment in legal tender of the Indebtedness. If Lender so requests,
any notes or credit agreements now or hereafter evidencing any debts or obligations of Borrower to Guarantor shall be marked with
a legend that the same are subject to this Guaranty and shall be delivered to Lender. Guarantor agrees, and Lender is hereby authorized,
in the name of Guarantor, from time to time to file financing statements and continuation statements and to execute documents
and to take such other actions as Lender deems necessary or appropriate to perfect, preserve and enforce its rights under this
Guaranty.


 


MISCELLANEOUS PROVISIONS.
The following miscellaneous provisions are a part of this Guaranty:


 


Amendments.
This Guaranty, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the
matters set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given in writing
and signed by the party or parties sought to be charged or bound by the alteration or amendment.


 


Attorneys’
Fees; Expenses. Guarantor agrees to pay upon demand all of Lender’s costs and expenses, including Lender’s attorneys’
fees and Lender’s legal expenses, incurred in connection with the enforcement of this Guaranty. Lender may hire or pay someone
else to help enforce this Guaranty, and Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include
Lender’s attorneys’ fees and legal expenses whether or not there is a lawsuit, including attorneys’ fees and
legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and
any anticipated post-judgment collection services. Guarantor also shall pay all court costs and such additional fees as may be
directed by the court.


 


Caption
Headings. Caption headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define
the provisions of this Guaranty.


 


Governing
Law. This Guaranty will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the
laws of the State of New Mexico without regard to its conflicts of law provisions.


 


Integration.
Guarantor further agrees that Guarantor has read and fully understands the terms of this Guaranty; Guarantor has had the opportunity
to be advised by Guarantor’s attorney with respect to this Guaranty; the Guaranty fully reflects Guarantor’s intentions
and parol evidence is not required to interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds Lender harmless
from all losses, claims, damages, and costs (including Lender’s attorneys’ fees) suffered or incurred by Lender
as a result of any breach by Guarantor of the warranties, representations and agreements of this paragraph.


 


Interpretation,
In all cases where there is more than one Borrower or Guarantor, then all words used in this Guaranty in the singular shall
be deemed to have been used in the plural where the context and construction so require; and where there is more than one Borrower
named in this Guaranty or when this Guaranty is executed by more than one Guarantor, the words “Borrower” and “Guarantor”
respectively shall mean all and any one or more of them. The words “Guarantor,” “Borrower,” and “Lender”
include the


 



     


     


    

	Loan
    No: 1218300	 	COMMERCIAL GUARANTY
(Continued)	 	Page
    3



 


heirs,
successors, assigns, and transferees of each of them. If a court finds that any provision of this Guaranty is not valid or should
not be enforced, that fact by itself will not mean that the rest of this Guaranty will not be valid or enforced. Therefore, a
court will enforce the rest of the provisions of this Guaranty even if a provision of this Guaranty may be found to be invalid
or unenforceable. If any one or more of Borrower or Guarantor are corporations, partnerships, limited liability companies, or
similar entities, it is not necessary for Lender to inquire into the powers of Borrower or Guarantor or of the officers, directors,
partners, managers, or other agents acting or purporting to act on their behalf, and any indebtedness made or created in reliance
upon the professed exercise of such powers shall be guaranteed under this Guaranty.


 


Notices.
Any notice required to be given under this Guaranty shall be given in writing, and, except for revocation notices by Guarantor,
shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited
with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified
or registered mail postage prepaid, directed to the addresses shown near the beginning of this Guaranty. All revocation notices
by Guarantor shall be in writing and shall be effective upon delivery to Lender as provided in the section of this Guaranty entitled
“DURATION OF GUARANTY.” Any party may change its address for notices under this Guaranty by giving formal written
notice to the other parties, specifying that the purpose of the notice is to change the party’s address. For notice purposes,
Guarantor agrees to keep Lender informed at all times of Guarantor’s current address. Unless otherwise provided or required
by law, if there is more than one Guarantor, any notice given by Lender to any Guarantor is deemed to be notice given to all Guarantors.


 


No
Waiver by Lender, Lender shall not be deemed to have waived any rights under this Guaranty unless such waiver is given in
writing and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of
such right or any other right. A waiver by Lender of a provision of this Guaranty shall not prejudice or constitute a waiver of
Lender’s right otherwise to demand strict compliance with that provision or any other provision of this Guaranty. No prior
waiver by Lender, nor any course of dealing between Lender and Guarantor, shall constitute a waiver of any of Lender’s rights
or of any of Guarantor’s obligations as to any future transactions. Whenever the consent of Lender is required under this
Guaranty, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances
where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender.


 


Successors
and Assigns. Subject to any limitations stated in this Guaranty on transfer of Guarantor’s interest, this Guaranty shall
be binding upon and inure to the benefit of the parties, their successors and assigns.


 


Waive
Jury. Lender and Guarantor hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either
Lender or Guarantor against the other.


 


DEFINITIONS.
The following capitalized words and terms shall have the following meanings when used in this Guaranty. Unless specifically
stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words
and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require.
Words and terms not otherwise defined in this Guaranty shall have the meanings attributed to such terms in the Uniform Commercial
Code:


 


Borrower.
The word “Borrower” means Hawksite 27 Development Company, LLC and includes all co-signers and co-makers signing
the Note and all their successors and assigns.


 


GAAP.
The word “GAAP” means generally accepted accounting principles.


 


Guarantor.
The word “Guarantor” means everyone signing this Guaranty, including without limitation AMREP Southwest Inc.,
and in each case, any signer’s successors and assigns.


 


Guaranty.
The word “Guaranty” means this guaranty from Guarantor to Lender.


 


Indebtedness.
The word “Indebtedness” means Borrower’s indebtedness to Lender as more particularly described in this Guaranty.


 


Lender.
The word “Lender” means Main Bank, its successors and assigns.


 


Note.
The word “Note” means the Promissory Note dated July 20, 2018, in the original principal amount of $1,800,000.00
from Borrower to Lender, together with all renewals of, extensions of, modifications of, refinancing’s of, consolidations
of, and substitutions for the Promissory Note or Agreement.


 


Related
Documents. The words “Related Documents” mean all promissory notes, credit agreements, loan agreements, environmental
agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments,
agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness.


 


EACH
UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH
GUARANTOR UNDERSTANDS THAT THIS GUARANTY IS EFFECTIVE UPON GUARANTOR’S EXECUTION AND DELIVERY OF THIS GUARANTY TO LENDER
AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE MANNER SET FORTH IN THE SECTION TITLED “DURATION OF GUARANTY”.
NO FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY IS DATED JULY 20, 2018.


 


	GUARANTOR:
	 	 	 
	AMREP SOUTHWEST
INC.
	 	 	 
	 	 	 
	By:	/s/ Carey A. Plant	 
	 	Carey A. Plant, Secretary
	 	Date: July 24, 2018



 


 



 


CORPORATE
    ACKNOWLEDGMENT


 


	STATE
    OF NEW MEXICO	)	 
	 	)	SS
	COUNTY
    OF SANDOVAL	)	 



 


This instrument was acknowledged before me on July 24, 2018 by Carey A. Plant, Secretary of AMREP Southwest
Inc., a New Mexico corporation, on behalf of the corporation.


 


	 	 	 	 	 
	 	 	 	/s/ Nicole Hite	 
	 	 	 	NOTARY PUBLIC	 
	 	 	 	 	 
	My commission expires:	 	 	 	 
	 	 	 	 	 
	May 31, 2021